Direct Supply positioned for rapid growth

Company planning major expansion over next few years

Direct Supply’s technology center on MSOE’s campus is located in the German-English Academy building at 1020 N. Broadway in downtown Milwaukee.

Baby boomers have been eclipsed by millennials as the largest living generation in the United States, according to population estimates released this spring by the Pew Research Center. But that doesn’t mean the aging generation, which for years has shaped the nature of U.S. culture, will stop exerting its hefty influence over the country’s economy any time soon.

Especially when it comes to the senior living industry.

A rendering of Direct Supply’s planned $60 million campus expansion along North Industrial Road on Milwaukee’s northwest side.
A rendering of Direct Supply’s planned $60 million campus expansion along North Industrial Road on Milwaukee’s northwest side from Continuum Architects + Planners.

And Direct Supply, an employee-owned senior living industry supplier founded on Milwaukee’s northwest side in 1985, is well positioned to capitalize on the country’s graying demographic shift.

By 2029, every member of the baby boomer generation will be 65 or older and together will account for roughly 20 percent of the U.S. population, according to the U.S. Census Bureau. Since younger generations are opting to get married later than previous generations and have fewer children, the Census Bureau projects the nation’s demographic shift toward an increasingly older population will endure well into the 21st century.

Those trends bode well for Direct Supply. That sector of the population – those ages 65 or older – is the backbone of its business.

Direct Supply offers a comprehensive slate of equipment, furnishings, renovation and design services, technology solutions, building management services and automated procurement services to senior living communities across the country and has spent more than 30 years laying foundations in the industry. Now that industry is on the cusp of massive growth.

Based on its plans to expand, Direct Supply’s efforts have been paying off – as has its recent push to recruit young engineers to expand its e-commerce solutions and computer technologies offerings related to building management and senior care.

In March, Direct Supply announced plans to expand at its 10-building headquarters campus along North Industrial Road on the city’s northwest side. Plans call for a five-story, 280,000-square-foot building to be constructed in place of an existing single-story building.

A presentation the company shared with the Milwaukee Common Council in July indicated it plans to spend $60 million constructing its new headquarters building. As part of the project, the Common Council approved the company’s request to close a portion of North Industrial Road, which currently runs through the center of its campus.

Direct Supply’s technology center on MSOE’s campus is located in the German-English Academy building at 1020 N. Broadway in downtown Milwaukee.
Direct Supply’s technology center on MSOE’s campus is located in the German-English Academy building at 1020 N. Broadway in downtown Milwaukee.

In August, the state certified Direct Supply under the Wisconsin Economic Development Corp. Enterprise Zone Program to generate $22.5 million in tax credits to help finance the expansion and the company’s vow to create 800 new jobs over the next seven years that would pay $30 or more per hour.

The company currently employs roughly 1,100 people at its headquarters campus and an additional 100 computer engineers and technology interns at its technology center located on the Milwaukee School of Engineering campus downtown, where the company also plans to expand its presence. MSOE confirmed earlier this month that Direct Supply was negotiating a lease with the engineering college to occupy the entire four-story, 48,000-square-foot German-English Academy building at 1020 N. Broadway.

The technology center, which opened in 2012 as a way to connect MSOE computer engineering and business students with internships and experience working for Direct Supply, has served as a talent pipeline for the company as it has expanded its e-commerce and technology solutions services over the past four years.

It also includes an incubator for startups Direct Supply has been investing in to develop innovative technologies that could be useful in the senior living industry. One of those startups, Milwaukee-based OnKöl, has developed advanced monitoring devices that senior living communities could use to track the health and location of patients.

“We could not be in a better place,” said OnKöl founder Marc Cayle of his company’s presence in the Direct Supply Technology Innovation Center at MSOE. He said Direct Supply introduced the company to two or three of the chief executive and chief technology officers at the largest senior living companies in the world within the first week it was in the center.

“The credibility that it adds for our brand is unbelievable,” Cayle said.

When it opened four years ago, the technology center occupied 9,000 square feet of space on the building’s top floor, but has since expanded into an additional 9,000 square feet of space on the third floor. Expanding into the building’s bottom two floors would add 30,000 gross square feet of space.

“The negotiations aren’t complete for the lease, but (Direct Supply’s) intention is to take over the entire building,” MSOE spokesperson JoEllen Burdue said on Oct. 17. “They’re planning to do some remodeling work, but a timeline hasn’t been finalized yet.”

Direct Supply did not return a request for comment for this report.

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Ben Stanley, former BizTimes Milwaukee reporter.

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